Calculation error leaves schools short by $25 million

A miscalculation in education funding has caused the state\'s education budget to be short by $25 million. (Associated Press)

SALT LAKE CITY — A miscalculation in funding has caused the state's education budget to be short by $25 million, the Utah State Office of Education announced Wednesday, but officials say they have the money to fix the mixup.

According to officials, a faulty data entry in a spreadsheet used to calculate weighted pupil units — which determines a school district's per-pupil funding — caused the miscalculation. When corrected, the number of projected pupil units in the state for the 2012-2013 school year increases by an estimated 8,000.

Associate Superintendent Todd Hauber and director of school finance Larry Newton have submitted their resignations as a result of the miscalculation. Mark Peterson, a spokesman for the office of education, said their resignations have been accepted by the State Board of Education, but both officials will stay on until replacements can be found.

The error accounts for less than 1 percent of the state's $3 billion education budget and is within the historical margin of error for funding estimates. Both the State Board of Education and lawmakers are saying the problem can be corrected without negative impact to schools.

"There are resources available to fix this problem," State Superintendent Larry Shumway said in a prepared statement. "It is important for taxpayers to know the error here, while not insignificant, is a statistical error and does not indicate any misappropriation of funds."

It is expected that funds carried over from the current fiscal year will be enough to fill the funding gap left by the error, although the exact amount of money available will not be known until July. Utah's budgeting process uses estimates of expected pupil units and tax revenue to appropriate funds, which historically results in money left over for the following school year. Peterson said the carry over balance in 2011 was around $30 million.

It is also possible that the number of new students will be less than estimated, which would minimize the amount of deficient funds, but an accurate headcount will not be taken until October.

At the end of the most recent legislative session, about $110 million in additional funding was added to the $3 billion base budget. In a prepared statement, Sen. Lyle Hillyard, R-Logan, said Wednesday the Legislature is committed to funding new students entering the education system.

"This is Utah, when we find a problem we fix it," said Hillyard, who co-chairs the Executive Appropriations Committee. "I believe we can find a way to keep the schools whole and create better verification on enrollment numbers to prevent this from happening in the future."

The Utah State Democratic Party quickly seized upon the announcement, criticizing the leadership of Gov. Gary Herbert, who is running for re-election this year. In a prepared statement issued Wednesday, state party Chairman Jim Dabakis cited the education funding error and the recent security breach of private records at the Utah Department of Health as examples of "sloppy mistakes" that hurt Utahns.

"This is the latest in a long line of Herbert administration miscues. Just this week alone, 800,000 Utahns were exposed to identity fraud. And now there’s a $25 million education funding gap because the Governor’s Office can’t count?" Dabakis said. "It’s time for Governor Herbert to take responsibility for this mess."

Herbert spokeswoman Ally Isom said the Governor's Office was in no way responsible for the miscalculated funds. She said the office of education made it clear in the announcement that the error had occurred in their accounting.